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November 24, 2012

13Ds are filed with the Securities and Exchange Commission within 10 days of an entity's attaining a greater than 5% position in any class of a company's securities. Subsequent changes in holdings or intentions must be reported in amended filings. This material has been extracted from filings released by the SEC from Nov. 15 through Nov. 21, 2012. Source: InsiderScore.com

Hedge fund Starboard Value sent a letter to the company criticizing its recent adoption of a "poison pill" provision that seeks to limit ownership to 15%.

In the letter, dated Nov. 16, Starboard said the provision was "designed specifically to entrench the current board" and, given that Starboard owns nearly 15% of the company, that it was "directly aimed" at Starboard. The hedge fund also called the provision "highly questionable."

Starboard disclosed that it now owns 42,100,000 (14.8% of voting shares); it did not disclose buying or selling any shares.

Original Filings

Balch Hill Capital disclosed total holdings of 4,190,000 shares (9.0%) after it bought 3,313,609 from Sept. 18 through Nov. 15 for $4.10 to $7.13. In its filing, Balch Hill called STEC shares "undervalued" but did not disclose any specific plans or proposals.

Atlantic Investment Management disclosed that it now owns 4,699,425 shares (6.1%) after it bought 847,571 shares from Oct. 23 through Nov. 15 at prices ranging from $42.68 to $47.11 each. Atlantic also disclosed selling 65,870 shares from Nov. 6 through Nov. 14 at prices ranging from $44.83 to $46.89 apiece.

Atlantic said it will "continue its active discussions" with management regarding actions that might be taken to maximize shareholder value. It added that it may "hold discussions with other parties who might engage in shareholder value enhancing activities for the benefit of all of [Rockwood's] shareholders."

The Activist Spotlight

Business: producer and marketer of nutrients for agricultural and industrial markets Stock-Market Value: $15 billion ($100.66 per share) Investor's Average Cost: $84.62 per share What's Happening: JANA Partners is nominating five people to the company's board.

Key Numbers: $780 million: what JANA has spent acquiring AGU common stock, the largest position in its portfolio. $12.2 million:what JANA's four other director nominees have spent acquiring AGU common stock. 450: the number of shares purchased by AGU board members since 2003.

Behind the Scenes: Agrium has two businesses: a fertilizer wholesaler and an agricultural products retail distributor. The volatile wholesale business is commodity-driven; the retail business is more stable. The businesses operate at arm's length, with no real synergies; less than 10% of the retail unit's sales come from products manufactured by the wholesale unit. For years, management openly admitted that the retail business was undervalued, based on comps with other retailers it named. Now, with JANA holding it accountable, management is not changing how it operates, but is instead changing the retailers on which it bases the comps, so it can argue that there is no undervaluation. JANA is nominating a retail "dream team" to Agrium's board, which currently does not have one independent member with retail distribution experience. JANA would not be proceeding with a proxy fight unless it was confident it would win and create significant shareholder value. JANA has a history of activism with well-conceived, highly researched plans, and as a result is well respected in the institutional investor community.

-- Kenneth Squire

The 13D Activist Fund, a mutual fund runby an affiliate of the author and not connected to Barron's, has a long position in Agrium. In addition, the author publishes and sells 13D research reports, whose buyers may include representatives of participants in, and targets of, shareholder activism.